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February 03, 2021

The Short Squeeze – Entertainment Dollars That Carry A Populist Political Statement
[Buck Throckmorton]

With the GameStop short squeeze hitting too close to home, our cultural betters are once again tut-tutting about the rubes’ ignorant financial behavior. They liken it to the tulip bulb mania of centuries ago, wanting to believe that the runup in stock price is due to suckers trying to get rich quick by buying in on the way up, and then selling before the bubble bursts. They are thinking wrong – throwing $500 into GME stock is like a political contribution that absolutely hurts your political enemy, yet it may also bring a financial return.

Phetasy - Hedge Funds.JPG


Aside from the fact that there are only 47 million shares available for trade to support the 62 million shorts that hedge fund geniuses will have to buy at market price – which means a ton of wealth will be transferred from hedge funds to rubes – the motivation for so many of the “squeezers” is simply to stick it to the powerful and the connected. For a rube investing in the squeeze, losing their entire stake is like losing money in Vegas, it’s entertainment dollars that are chosen to be spent in that manner. Heck – a Hamilton ticket costs $500. Is $500 spent on going to war with hedge fund hotshots any less entertaining?

But unlike entertainment dollars spent on a Hamilton ticket or in Vegas, money thrown at the squeeze also has a socio-political impact.

If you want to make an impact with $500, would $500 given to a political party make a difference?

What if you gave your $500 to a foundation? At the 3% annual distribution rate, it would only take 33 years for your $500 to have fully worked its way into the hands of the cause you believe in.

What about giving the $500 to your favorite online political publication, or maybe to a think tank?

What about giving $500 to your alma mater?

In any of those scenarios, you would pretty much be flushing your money away with no chance of recouping a penny or seeing any good come of it. Yet the very intelligent people mocking you for squeezing the hedge fund guys are the same ones trying to get you to waste your money by giving it to these pet causes.

Well, messing with the financial parasites at hedge funds is a worthy pet cause. They would gladly destroy your business, terminate your job, and completely destroy your life for an extra buck…all the while laughing at you and mocking you. These same masters of the universe are now in a desperate bind, hoping their political connections can somehow bail them out and protect them from the most dangerous foe they’ve ever encountered. That foe is you.

Don’t spend any money on the short squeeze that you aren’t willing to part with. Also consider giving some of it to a legitimate charity. But if this is how you are allocating your entertainment dollars, what a remarkable show you’re participating in.

(buck.throckmorton at gmail.com)

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posted by Open Blogger at 05:25 PM

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